Conferencia de resultados del 3T de 2026 de Hanmi Financial (HAFC): aumentan el NIM y la producción de préstamos

Puntos clave

• El beneficio neto aumentó con respecto al trimestre anterior hasta 23,7 millones de dólares, o 0,80 dólares por acción diluida. La rentabilidad sobre los activos medios fue del 1,17%, mientras que la rentabilidad sobre el patrimonio neto medio alcanzó el 10,90%.
• Los ingresos netos antes de provisiones aumentaron un 10,8% en comparativa trimestral, respaldados por un 5,8% de aumento en los ingresos netos por intereses y una gestión disciplinada de los gastos.
• El margen neto de intereses se amplió 8 puntos básicos hasta el 3,44%. Aproximadamente 4 puntos básicos del aumento procedieron de varios elementos específicos del trimestre.
• La concesión de préstamos aumentó un 46,2% en comparativa trimestral hasta los 544 millones de dólares, con crecimiento en todas las categorías de producción. Sin embargo, las elevadas amortizaciones anticipadas limitaron la expansión del balance.
• Los depósitos aumentaron un 1,4%, incluyendo un crecimiento del 1,9% en los depósitos principales. Los depósitos de Corporate Korea aumentaron un 12% hasta superar los 1.300 millones de dólares, lo que representa aproximadamente el 19% del total de depósitos.
• El gasto por pérdidas crediticias aumentó a 4,5 millones de dólares, reflejando principalmente un saneamiento parcial de 3,2 millones de dólares en un préstamo inmobiliario comercial identificado previamente.

Datos financieros clave

Rendimiento comercial y operativo

La producción de préstamos comerciales e industriales totalizó 170 millones de dólares. Los saldos de C&I se mantuvieron estables en tasa trimestral, pero aumentaron un 11,3% interanual, lo que elevó la categoría al 18% de la cartera total de préstamos, frente al 16% de un año antes.

La producción para el sector inmobiliario comercial aumentó un 33,4% hasta los 227 millones de dólares. El sector CRE se mantuvo el 61% del total de préstamos. La cartera presentó una relación préstamo-valor media ponderada de aproximadamente el 47% y un ratio de cobertura del servicio de la deuda medio ponderado de 2,27x.

La producción de hipotecas residenciales aumentó un 54% en términos secuenciales hasta los 77 millones de dólares. Hanmi vendió 13 millones de dólares de hipotecas residenciales, lo que generó una ganancia de 0,2 millones de dólares.

La producción de préstamos de la SBA alcanzó los 41 millones de dólares, lo que representa un aumento de 4 millones de dólares respecto al trimestre anterior. La empresa vendió aproximadamente 34 millones de dólares en préstamos de la SBA con una prima del 8,1% , frente a los 20,9 millones de dólares con una prima del 7,92% en el 2T.

Corporate Korea generó 34 millones de dólares en originación trimestral de préstamos. Los saldos de sus préstamos cayeron un 5% en términos secuenciales hasta los 780 millones de dólares, o aproximadamente el 12% del total de préstamos. En cambio, los depósitos de Corporate Korea aumentaron en 145 millones de dólares hasta más de 1.300 millones de dólares a medida que los clientes acumularon fondos antes de posibles gastos de capital e inversiones de fabricación.

Las amortizaciones anticipadas de préstamos alcanzaron los 283 millones de dólares. Más de un tercio obedeció a refinanciaciones por parte de entidades competidoras que ofrecían condiciones fuera de los criterios de concesión de Hanmi. Aproximadamente una cuarta parte procedió de la venta de inmuebles o de prestatarios que utilizaron sus propios fondos, mientras que algo menos del 10% derivó de la decisión de Hanmi de rescindir relaciones comerciales.

Previsiones de la dirección

La dirección prevé un crecimiento de los préstamos de un dígito bajo para todo el año 2026, asumiendo que la originación se mantenga cerca de los niveles recientes y que las amortizaciones anticipadas continúen moderándose.

Para 2027, la dirección proyectó un crecimiento de los préstamos de un dígito bajo a medio . Afirmó que el crecimiento podría alcanzar un dígito medio o incluso superarlo si el aumento de los tipos reduce las amortizaciones anticipadas vinculadas a refinanciaciones y se mantiene la inercia actual de la originación.

La dirección prevé una originación trimestral de préstamos SBA de aproximadamente 45 millones a 50 millones de dólares, con una variación potencial del 5% al 10%. Hanmi prevé vender toda la producción de SBA 7(a).

En cuanto a las recompras de acciones para el 4T de 2026, la dirección indicó que la empresa probablemente mantendría aproximadamente el mismo ritmo de ejecución en dólares observado durante los tres trimestres anteriores.

Riesgos y aspectos a vigilar

Las partidas específicas del trimestre aportaron aproximadamente 700.000 dólares a los ingresos netos por intereses y contribuyeron con cerca de 4 puntos básicos al margen neto de intereses. Entre ellos se incluyeron partidas de comisiones relacionadas con préstamos, un dividendo especial del FHLB de San Francisco y gastos de intereses solapados asociados a la emisión y amortización de obligaciones subordinadas.

Los costes de los depósitos que devengan intereses promediaron un 3,18% durante el 3T y aumentaron hasta el 3,19% en septiembre y alcanzó aproximadamente el 3,22% en lo que va de octubre. La directiva señaló que los costes de los depósitos podrían seguir aumentando, especialmente si las medidas sobre los tipos de interés de la Reserva Federal son sustanciales o si la presión competitiva se intensifica.

Más de 1.000 millones de dólares en certificados de depósito vencían según lo previsto en el T4 a un tipo medio de aproximadamente el 3,69%. La fijación de precios de las renovaciones y de los nuevos depósitos en octubre fue bastante similar, lo que no supuso ni un beneficio sustancial por repreciación ni un obstáculo significativo en ese momento.

Hanmi rebajó la calificación de dos relaciones crediticias multifamiliares actuales en Nueva York tras los cambios en la normativa local sobre el control de alquileres. La directiva también firmó un acuerdo para vender un préstamo CRE identificado previamente, cuyo cierre se prevé para el T4.

Los préstamos en mora y los préstamos dudosos se mantuvieron en niveles bajos del 0,20% y del 0,14% del total de préstamos, respectivamente. Los activos dudosos representaron el 0,12% del total de activos.

Puntos clave de la sesión de preguntas y respuestas con analistas

• Repreciación de préstamos: Aproximadamente el 25% de la cartera de préstamos se ajusta directamente con los tipos de interés, excluyendo los vencimientos programados. El rendimiento de la nueva producción se situó en torno al 6,6%, por encima del rendimiento ajustado de la cartera, de aproximadamente el 6%, lo que según la directiva debería favorecer una mejora gradual del rendimiento de los préstamos.
• Exposición al sector multifamiliar en Nueva York: Excluyendo los dos préstamos a los que se rebajó la calificación, el resto de la cartera se compone de aproximadamente media docena de préstamos de menor cuantía. La directiva indicó que la mayoría estaban al corriente de pago y que la mayor parte de los inmuebles no estaban sujetos al control de alquileres.
• Medidas sobre el capital: Hanmi recompró 4,9 millones de dólares en acciones durante el T3. Un total de 1,84 millones de acciones continuaban disponibles en virtud de la autorización existente.
• Financiación y protección frente a los tipos de interés: Hanmi amortizó 110 millones de dólares en pagarés subordinados con vencimiento en 2031 tras emitir 55 millones de dólares en pagarés con vencimiento en 2036, reduciendo los gastos anuales por intereses recurrentes en aproximadamente 550.000 dólares. También añadió un límite máximo de tipo de interés (cap) a dos años sobre 26 millones de dólares en valores preferentes de fideicomiso y fijó el tipo de interés de 180 millones de dólares en depósitos a plazo de California en el 4,46% mediante un swap a dos años.

Transcripción completa de la conferencia de resultados

Transcripción completa de la conferencia de resultados

Comentarios de la dirección

Operator

Ladies and gentlemen, welcome to the Hanmi Financial Corporation's Third Quarter 2026 Conference Call. As a reminder, today's call is being recorded for replay purposes. [Operator Instructions] I would now like to turn the call over to Ben Brodkowitz, Investor Relations for the company. Please go ahead.

Ben Brodkowitz

Thank you, operator, and thank you all for joining us today to discuss Hanmi's Third Quarter 2026 results. This afternoon, Hanmi issued its earnings release and quarterly supplemental slide presentation to accompany today's call. Both documents are available in the IR section of the company's website at hanmi.com. .

I'm here today with Bonnie Lee, President and Chief Executive Officer of Hanmi Financial Corporation; Anthony Kim, Chief Banking Officer; and Ron Santarosa, Chief Financial Officer. Bonnie will begin today's call with an overview. Anthony will discuss loan and deposit activities. Ron will provide details on our financial performance, and then Bonnie will provide closing comments before we open the call up for your questions.

Before we begin, I would like to remind you that today's comments may include forward-looking statements under the federal securities laws. Forward-looking statements are based on current plans, expectations, events and financial industry trends that may affect the company's future operating results and financial position.

Our actual results may differ materially from those contemplated by our forward-looking statements, which involve risks and uncertainties. Discussion of the factors that could cause our actual results to differ materially from these forward-looking statements can be found in our SEC filings, including our reports on Forms 10-K and 10-Q. In particular, we direct you to the discussion of certain risk factors affecting our business contained in our earnings release, our investor presentation and in our Form 10-Q.

With that, I would now like to turn the call over to Bonnie Lee. Bonnie? Please go ahead.

Bonita Lee

Thank you, Ben, and good afternoon, everyone. Thank you for joining us today to discuss Hanmi's Third Quarter 2026 results. Hanmi delivered a solid quarter with excellent deposit growth, robust loan production, strong asset quality and prudent capital management. As a result, pre-provision net revenues grew 10.8% sequentially reflecting an increase in net interest income and margin as well as the disciplined expense management. Credit loss expense was higher, but demonstrated our commitment to resolving credit issues quickly. Collectively, our performance this quarter shows the durability of our franchise, continued momentum across all lines of business and our ability to generate sustainable, profitable growth.

Now turning to some highlights for the quarter. Net income increased from last quarter to $23.7 million or $0.80 per diluted share. Deposits grew 1.4% on a linked-quarter basis, with the core deposits increasing 1.9% reflecting the strength and quality of our funding base while noninterest-bearing deposits remained stable at 3% of total deposits.

Loan originations were strong at $544 million with a notable increase in tenants. Net interest income increased 5.8% sequentially and net interest margin increased by 8 basis points to 3.44%. We maintained disciplined expense management, improving our efficiency ratio by more than 200 basis points to 52% demonstrating our ability to generate positive operating efforts.

Credit loss expense was $4.5 million and reflected a $3.2 million loan charge-off to resolve a previously identified CRE loan. Last, the return on average assets for the third quarter was 1.17%, and the return on average equity was 10.90%.

Moving on to our corporate Korea initiative. This area of our business activities continues to generate meaningful results. The investments we have made in specialized bankers and targeted client coverage are deepening customer relationships and driving increased business activity.

Deposits from corporate Korea clients increased 12% during the quarter to $1.3 billion, reaching an all-time high of approximately 19% of total deposits. While loans for corporate clear clients represent 12% of total loans. This initiative continues to be a significant growth opportunity and a key differentiator for Hanmi.

Turning now to asset quality. Hanmi's credit metrics continue to demonstrate disciplined underwriting and active portfolio oversight. During the quarter, we took 2 actions that underscore our proactive about the credit risk management. First, we entered into an agreement to sell the previously identified CRE loan with the closing expected during the fourth quarter. This action enables us to avoid a potentially prolonged resolution process and more quickly redeploy these funds into interest-earning assets with a more attractive risk-adjusted returns.

In addition, following changes to local rent control regulations in New York City, we proactively reassessed to multifamily loan relationships and downgraded these loans to reflect this evolving risk environment. Although these 2 loans are current, we believe these actions illustrate our commitment to identify issues early and addressing them decisively to preserve the long-term strength of the loan portfolio. Although delinquent loans and nonperforming loans continued to be a low percentage of total loans at 0.2% and 0.14%, respectively, at quarter end. Nonperforming assets also remained constant at 0.12% of total assets.

Last, I would like to highlight our capital strength and prudent capital management. Tangible common equity to tangible assets was 9.93% and all regulatory capital ratios were strong. With the solid earnings for the third quarter, we returned 55.6% of third quarter net income to shareholders through dividends and share repurchases.

Our capital position provides Hanmi flexibility to pursue attractive growth opportunities, invest strategically in the business and continue delivering compelling returns to shareholders.

I'll now turn the call over to Anthony Kim, our Chief Banking Officer, to discuss loan production and deposit trends in greater detail. Anthony?

Anthony Kim

Thank you, Bonnie, and thank you for joining us today. I'll begin by providing additional details on our loan production. Third quarter loan production was $544 million, up $172 million or 46.2% from the prior quarter with a weighted average interest rate of 6.61% compared to 6.59% last quarter. The increase in loan production was primarily due to an increase in C&I, CRE and residential. In fact, every category of loan production increased during the third quarter.

We maintained a disciplined underwriting framework engaging owning opportunities that are consistent with our conservative underwriting principles. C&I production was $170 million with a broad representation of industries such as manufacturing and wholesale. While C&I loan balances were flat from the prior quarter, they grew 11.3% from the same period a year ago. Additionally, C&I loans have grown to 18% of total loan portfolio from 16% a year ago. This growth reflects our investment in C&I talent, the continued traction of our U.S. case initiative and the successful execution of our strategy to broaden the portfolio.

Total commitments for our commercial lines of credit were $1.4 billion in the third quarter up approximately 5% from the previous quarter and 7% from a year ago. Outstanding balances increased by 3%, resulting in a utilization rate of 39.7% and down slightly from 40.3% in the prior quarter. CRE production was $227 million, an increase of $57 million or 33.4%. CRE loans remained 61% of our total loans. We are pleased with the quality of our selling portfolio. It has a weighted average loan-to-value ratio of approximately 47% and a weighted average debt service coverage ratio of 2.27x.

Residential mortgage loan production was $77 million for the third quarter up 54% or $27 million from the previous quarter. Residential mortgage loans represent approximately 15% of our total portfolio, consistent with the previous quarter. We sold $13 million of residential mortgages during the third quarter, resulting in a gain on sale of $0.2 million. We'll continue to evaluate additional sales, contingent on market conditions.

As pay was a bright spot this quarter with production sales trade premiums are higher. SBA loan production increased $4 million from the prior quarter to $41 million while slightly below in historical debt levels, our pipeline indicates a pickup in production in the fourth quarter, underscoring the strength of our recent investment in talent and the momentum we are generating with the small business clients across our markets. During the quarter, we sold approximately $34 million of SBA loans.

Turning to Corporate Korea, which accounted for $34 million of total loan production. USK loan balances were $780 million, down $46 million or 5% from the prior quarter and represent approximately 12% of our total loan portfolio. Last, payoffs, which are invariable each quarter, were substantially higher at $283 million for the third quarter -- more than 1/3 of our payoffs were driven by refinancing with the other lenders offering terms that did not meet our disciplined underwriting and risk criteria. Approximately 1/4 of the payoffs were from the sale of property or the borrower using their own cash. Just under 10% of payoffs were due to our desire to exit the loan relationships.

Turning now to deposits. In the third quarter, deposits increased 1.4% from the prior quarter, driven primarily by growth in nonmaturity, interest-bearing deposits and a 1.9% increase in core deposits. Deposit balances for USKC customers increased by $145 million or 12%, surpassing $1.3 billion. At quarter end, corporate Korea deposits represented 19% of total deposits and 18% of bank's demand deposits. The composition of our deposit base remains stable, reflecting the strength of our relationship banking model. At the end of third quarter, noninterest-bearing deposits remained healthy at 30% of total bank deposits.

And now I'll hand the call over to Ron Santarosa, our Chief Financial Officer, for more details on our third quarter financial results.

Romolo Santarosa

Thank you, Anthony, and good afternoon all. I will begin with Hanmi's 10.8% sequential increase in third quarter pre-provision net revenues before turning to the credit loss expense for the quarter. First, net interest income grew 5.8% on a linked quarter basis due to the 2.4% increase in average interest-earning assets and the 8 basis point net interest margin expansion.

The 3.1% growth in average core deposits efficiently fueled growth in average interest-earning assets while a 13 basis point increase in average loan yield drove higher net interest income. This was partially offset by a 1 basis point increase in the cost of average interest-bearing deposits. We noted in the earnings release that there were several items affecting third quarter net interest income and net interest margin, namely an interest reversal from a nonaccrual loan accelerated deferred fee income and prepayment fees from loan payoffs, a special FHLB San Francisco dividend and overlapping interest expense from the issuance and redemption of subordinated notes.

Together, these items contribute approximately $700,000 of net interest income, representing 4 basis points or roughly half of the quarterly increase in net interest margin. The loan-related items contributed approximately 5 basis points to the in recent loan yield.

I also think it's important to note here that Hanmi undertook actions during the third quarter which together should aim future period net interest income and margin and what might be a higher interest rate environment going forward. At the end of July, Hanmi issued $55 million of fixed to floating rate subordinated notes due in 2036. These proceeds, combined with parent company resources were used to redeem on September 1, the $110 million fixed to floating rate subordinated notes due in 2031.

As a result, the company reduced its ongoing interest expense by $550,000 annually and avoided the burden of floating rate debt. Next, the company secured a 2-year interest rate cap for its $26 million floating rate trust preferred securities, where the floating rate of -- with a floating rate of 3-month SOFR plus 166 basis points at resets quarterly, cannot exceed 5.66%.

The bank also secured a 2-year interest rate swap for its $180 million of state of California time deposits, fixing the interest rate on these funds at 4.46%.

Moving on to noninterest income. It increased 8.2% on a linked-quarter basis, primarily due to higher gains from sales of SBA loans. Hanmi sold $34 million of SBA loans at a premium of 8.1%, significantly higher than the second quarter volume of $20.9 million with a premium of 7.92%. Completing the look at third quarter PPNR, noninterest expense increased 2.1%, primarily driven by a $1.1 million charge from the acceleration of deferred debt issuance costs upon the redemption of the 2031 notes. Absent that event, noninterest expense would have declined by 0.8% sequentially.

Turning to credit loss expense. It was $4.5 billion, up from $1.2 million for the second quarter. That increase was primarily due to a $3.2 million partial charge-off on the previously mentioned CRE loan. As such, annualized net charge-offs to average loans for the third quarter jumped to 27 basis points compared with 8 basis points for the second quarter. Absent this charge-off, annualized net charge-offs to average loans would have been 7 basis points.

Hanmi continued to return capital to shareholders in the form of dividends and share repurchases. Share repurchases for the third quarter were $4.9 million and 1.84 million shares currently remain available under the existing share repurchase program. Third quarter equity capital was negatively affected by the increase in the general level of interest rates at the end of the third quarter, resulting in a $16.5 million increase in unrealized after-tax losses on securities available for sale.

However, capital ratios continue to remain strong. The company's tangible common equity to tangible assets ratio was 9.93% at the end of the third quarter and its common equity Tier 1 ratio was 12.3%. Tangible common equity per share also remained essentially unchanged at $27.03. The bank's capital ratios also remained strong and well above the levels needed for the well-capitalized category. The bank had a total risk-based capital ratio of 14.33% and a common equity Tier 1 ratio of 13.28%.

With that, I will now turn it back to Bonnie.

Bonita Lee

Thank you, Ron. As we look ahead, we remain constructive on the operating environment. While geopolitical uncertainty was monitoring, the broader economy continues to be supported by growth, low unemployment and healthy business activity. As we enter the final quarter of the year, we remain well positioned for continued success. Healthy loan and deposit pipelines, strong customer activity and momentum across the franchise support our confidence in delivering continued earnings growth and attract shareholder returns. .

In closing, our third quarter performance highlights the strength of our franchise, the dedication of our employees and the trust our customers place in harmony. We remain focused on disciplined execution, sustainable growth, strong profitability and long-term value for our shareholders.

We'll now open the call to answer your questions. Operator, please go ahead.

Operator

[Operator Instructions] Our first question is from Matthew Clark with Piper Sandler.

Preguntas y respuestas

Matthew Clark

The margin, maybe for Ron, just trying to think through deposit cost going forward if you have the spot rate at the end of September. I saw the slide showing your beta the last couple of cycles, but tracking obviously well below that. I guess, how should we think about that beta and then on the CDs that are maturing in your deck and what kind of rate should we expect it to reprice to?

Romolo Santarosa

So beginning with average interest-bearing deposit costs. For the month of September, they were 3.19%, 1 basis point higher than the average for the quarter of 3.18%. For October to date, right now, it's about 3.22%, so about 4 basis points higher. And that does reflect the 25 basis point move that occurred mid- to late September. So at this point, in deposit competition, et cetera, it seems like interest-bearing deposit costs are holding in. The beta that you can deduce from that, I think, is well behaved. But again, we await a Fed decision tomorrow and then, of course, the Fed decision in December.

So against the backdrop of not knowing what that might be and then the deposit pressures from competition. I'll be optimistic in that the deposit costs may continue to creep. But if Fed moves in very large ways, then I would expect a much more pressure on our cost of deposits.

So I'll let Anthony talk about the CD market and the deposit market generally.

Anthony Kim

Yes. During the fourth quarter, I think a little over $1 billion is maturing at 3.69%. That's the rate in my head. Month-to-date October, the rate we're seeing renew plus a new combination, it's about the same. If it's maybe a little pet higher, but what I'm saying until October, it's about the same. So we have no benefit of repricing. We have no damage done from repricing.

Matthew Clark

That's great. Okay. And then shifting to your exposure in New York, it looks like you only have $84 million of multifamily in New York. I guess how much of that is rent stabilized? Or are those the 2 loans that you called out within that portfolio?

Bonita Lee

So excluding the 2 loans that we called out, the rest of the portfolio its competition of about half a dozen smaller loans, and most of them are current and majority of them are the properties are not in the rent -- majority of the properties are not in the rent control.

Matthew Clark

Okay. Great. And then just on the USKC initiative, the deposit growth looked really good again. Any color around what drove that by industry and how the pipeline looks going forward?

Anthony Kim

It's a more broad-based deposit increase from industries -- various industries. It's more of a -- we see influx of the fund coming in. They're preparing for the investment in whether in CapEx or the manufacturing facility to be deployed later on. So we continue to see influx of that.

Operator

Our next question is from Gary Tenner with D.A. Davidson.

Gary Tenner

I wanted to ask about loan growth, Bonnie. Obviously, really good production in the quarter. But even with that production year-to-date, your loans are essentially flat. So I'm just kind of wondering how you're thinking about net growth here in the fourth quarter and then how the environment is potentially shaping your thoughts on 2027?

Bonita Lee

Yes. So while our year-to-date deposit growth is trending mid-single-digit growth above 5%. Our loans despite of our robust production this quarter, it has stayed pretty flat or slightly moderately increase and it's really due to the payoffs. And if you trend year-to-date loan production compared to the same period last year, loan production is up 4%. But the payoffs compared to last year, year-to-date, it increased 65%.

So -- and that amount to over $250 million. So if we were to state the payoffs hedge remains stayed at the same level as last year. Obviously, our loan growth would have been 4%, which is in the mid-single digit growth. Just looking at the payouts, this quarter, it has subsided a little bit compared to the third quarter. However, definitely, looking at the year to average quarterly year-to-date payout is above $200 million. So we are looking at all in -- all in all, continuing with the production that we had we are probably looking at probably low single-digit growth in the loan for the year.

Gary Tenner

And coupled with that, any impact to the outlook in a higher-for-longer scenario or maybe preliminary thoughts about 2027 growth? Is that kind of mid-single-digit number you had mentioned a good assumption to start the year?

Bonita Lee

Yes. For the 2027, I would project the low- to mid-single-digit growth. And as rates actually go up, I would probably see a lower level of payoffs. So with that, we could even hit mid-single digit or even higher. Assuming that the production continues at the level that we have been enjoying.

Gary Tenner

Got it. Makes sense. And then just a follow-up, Ron, on kind of the rate sensitivity. I appreciate all the color on the deposit side of things. Can you just refresh us on the loan portfolio and how much of that is floating rate, either prime or short-term silver repricing?

Romolo Santarosa

About 25% of the portfolio for the truly adjust with rates. And then that's excluding any of the maturities that roll down to us in each quarter. .

Operator

Our next question is from Kelly Motta with KBW.

Kelly Motta

Maybe following up on that, it looks like your yield on new production has been pretty stable. Wondering, I think you break out loans for turning over the next year in the deck. Ron, if you could provide what the loan runoff cadence like in terms of full timing, it's pretty throughout the year as well as the yield on that?

Romolo Santarosa

So relative to the cadence, I guess, we have no better guess than what the scheduled maturities are. Again, that's before any of the payoffs that are induced by other lenders, the circumstance of the particular borrower or the actions that we've taken our own to ensure the credit quality of the book. So there's no other insight other than that.

With respect then to the rates, again, on a maturity basis, it's a mix of both fixed as well as variable rate loans. I think Anthony has ported the production, which is like 6 -- I can't remember the last digit 6.5-ish. If you will, so in this current rate environment, I would expect that, that would be the continued run rate, okay, give or take, against an average yield of the book, which on an adjusted basis for the activities that I mentioned earlier is probably just around 6%. And so you can start to see that the increment to the book is higher than the average of the book. So the loan yield should continue to kind of inch upward under that kind of scenario?

Kelly Motta

Got it. That's helpful. And then with higher rates, you've heard it it's pressuring SBA gain on sale margins. Just wondering if you could refresh us on your outlook, both on the production side of that business as well as your cadence itself.

Bonita Lee

Yes. I mean, similar to this quarter, I think that the run rate for in terms of production would be on a quarterly basis about $45 million to $50 million. Any given quarter plus/minus 5% to 10%. And then the sole portion, we sell all of our SBA 7(a) productions.

Kelly Motta

Got it. That's helpful. And then lastly, you guys were -- you were more active on the buyback here. Just wondering about appetite at the level especially in the context that the balance sheet growth on the loan side has been more limited because of the payoff.

Romolo Santarosa

So at least with respect to the fourth quarter of 2026, as we do visit each quarter our actions. I think it's fair to say that we'd probably continue at the same dollar run rate that you've seen in the previous 3 quarters.

Operator

[Operator Instructions] There are no further questions at this time. I'd like to hand the floor back over to management for any closing remarks.

Bonita Lee

Thank you for joining our call today. We appreciate your interest in Hanmi and look forward to sharing our progress with you. Thank you. .

Operator

This concludes today's conference call. You may disconnect your lines at this time. Thank you again for your participation.